I enjoyed the article on development economics. As a failed academic development economist and current private-sector economist, I wish I had read this before I started a PhD. The article has a lot of useful info, and nothing in it seems blatantly inaccurate. I have some additional thoughts, especially on being an academic development economist who does very “micro” work assessing interventions. I don’t have experience with other flavors of development economics.
Soft skills: This work requires local knowledge (as the article mentions), management skills, sometimes language skills, and willingness to spend a lot of time traveling (as the article mentions) and on the phone. A lot of the development economists I’ve met have been “people people” and good managers in addition to being good at technical work. They need to hire and supervise people to do rote tasks in foreign countries, such as taking surveys; hire both local and foreign research assistants; collaborate with charities, governments, and NGOs; and do all of the teaching, presenting, and reviewing that most academics do. Even if you are from a developing country, it’s a challenge to organize projects that are in a different country from where you are studying or working. Researchers tend to have multiple projects going on at once, often in different countries. If you want to do this kind of work, I strongly recommend working for an organization like J-PAL or IPA that will give you hands-on experience.
Comparison to other subfields in economics, and collaboration: The ProbablyGood article says that development economics may be a good path for someone who is interested in economics, but wants to work in a more collaborative way. I don’t quite agree with this framing. Most academic economics research is collaborative, and increasingly so; it’s not “writing papers alone in offices their whole career.” But in development, you work with more people and at greater geographic distances. That was a main reason that, while I’ve contributed to a few development economics projects, becoming a PI was not for me. I found the prospect of supervising field employees in a far-away country really stressful.
Longtermism: I don’t think we know whether improving global health and development now will have a big effect on the long-term future. Development economists are the perfect people to answer that question! If someone receives a gift of $1000, what are the long-term effects of that? Does it help them escape a poverty trap, send their kids to a better school, and lead to more innovation and political stability? Does it increase or decrease fertility? Or does the effect disappear within a year? What about macroeconomic interventions and large-scale policy changes, like austerity or increasing funding to schools? There’s been work on all of these questions, but I love to see a lot more.
Thanks for this detailed feedback, I’m happy to hear you think the article would be useful to people in situations you’ve been in. All three of the points you raised seem reasonable—some touch on nuances that I already have down in my full notes but were dropped for brevity, while others are things we hadn’t heard yet from the people we interviewed (including those acknowledged in the article, and several others who preferred to remain anonymous). Based on consultation with others I’ll look into incorporating some of these nuances, though I apologize in advance that not all nuances will be incorporated.
This seems like really excellent feedback for them!
I have a query about your final point, where I think I agree with the PG framing. In general, I think when people talk about the long-term future they are including consideration of timescales much longer than the few decades most of the examples you mentioned, of the order of hundreds of years, or even longer. This is one reason reducing existential risk is so popular (because while affecting the shape of the future seems both extremely uncertain and fairly dependent on world view, making sure that there is a future at all seems good from many perspectives, though not all). Am I correct in my intepretation that you were talking about “long term” mostly in the <100 year sense?
What does PG stand for? I did intend this feedback to be very positive. :)
I am claiming that causing economic improvements today could affect the future in 200+ years. The economic history literature provides many examples of events a few hundred years ago
that cause surprisingly long-term, large, and diffuse effects today. That includes effects on governance, culture, and other aspects of “institutions”; improving these could plausibly reduce
existential risk. I see this historical research as a proof of concept that very long-term effects might be possible, and I would love to see more economic historians and development
economists trying to figure out whether modern changes have such long-term effects, and how.
Here’s some reading suggestions; if you want to look into this yourself, good keywords are “economics” plus one of “persistence,” “institutions,” or “path dependence”. Full disclosure, I have not looked into this stuff since 2013.
Papers in the vein of “long-ago economic events had a big effect on the present”:
“The Colonial Origins of Economic Development”, Acemoglu, Johnson, and Robinson (2001),
has been cited 14k . The authors argue that the way countries were colonized
in the early 1800′s had a large effect on per capita income today, because the colonists
set up varying political institutions, such as property rights rules, which were highly persistent and affected economic development. Their book Why Nations Fail draws on this paper and others to argue that good economic conditions and good “institutions” tend to
reinforce each other, and so do bad ones. (By “institutions”, they mean “the rules of the game”, such as democracy or property rights.)
A blog post with a good discussion: “Last weekend I attended a conference at Brown University on ‘Deep-Rooted Factors in Economic Development’. [....] Nearly all of the papers gave
evidence that economic shocks or initial differences in economic outcomes dissipate
very, very slowly, if at all.” The same blog has the series The Skeptic’s Guide to Institutions,
a readable overview of the institutions literature, although (in the author’s words) “unfair, deliberately.”
“The Long Term Effects of Africa’s Slave Trades”, Nunn 2008. He says “I find a robust negative relationship between the number of slaves exported from a country and current economic performance” and that relationship is causal. In a later paper, he explores trust as a mechanism, saying “most of the impact of the slave trade is through factors that are internal to the individual, such as cultural norms, beliefs, and values.”
“The Persistent Effects of Peru’s Mining Mita”, Dell (2010) shows that a forced labor system in Peru from 1573 to 1812 lowered present-day household consumption by 25% and increased childhood stunting by 6%. She also attributes the persistence to institutions.
It sounds promising for people working on economic development that past events can have huge effects on the long-term future, but there are some caveats...
Economic history projects do not typically have the randomized controlled trials, high-quality data, or huge data sets used in other branches of economics, making the “persistence” literature less credible. “Colonial Origins” has been controversial on empirical grounds
Even if these papers are right that really bad things in the past had persistent effects, that doesn’t imply that doing good things things today will have persistent effects. “Critical junctures” may be in the past, an idea that Acemoglu et. al. (2008) touch on.
We should not expect a lot of persistence if there is an an overall trend towards convergence, where poorer countries tend to grow faster.
At the country level, poverty just doesn’t seem to be very persistent. See “Do Poverty Traps Exist?”.
My personal view is that if we improve present-day global health and development, we probably won’t change the far future much, but there’s a decent chance we would. There is empirical proof-of-concept backing for “persistence” and theoretical justification in the form of models of multiple equilibria and self-reinforcing cycles. I’d love to see more development economists and economic historians studying the conditions needed for persistence.
I enjoyed the article on development economics. As a failed academic development economist and current private-sector economist, I wish I had read this before I started a PhD. The article has a lot of useful info, and nothing in it seems blatantly inaccurate. I have some additional thoughts, especially on being an academic development economist who does very “micro” work assessing interventions. I don’t have experience with other flavors of development economics.
Soft skills: This work requires local knowledge (as the article mentions), management skills, sometimes language skills, and willingness to spend a lot of time traveling (as the article mentions) and on the phone. A lot of the development economists I’ve met have been “people people” and good managers in addition to being good at technical work. They need to hire and supervise people to do rote tasks in foreign countries, such as taking surveys; hire both local and foreign research assistants; collaborate with charities, governments, and NGOs; and do all of the teaching, presenting, and reviewing that most academics do. Even if you are from a developing country, it’s a challenge to organize projects that are in a different country from where you are studying or working. Researchers tend to have multiple projects going on at once, often in different countries. If you want to do this kind of work, I strongly recommend working for an organization like J-PAL or IPA that will give you hands-on experience.
Comparison to other subfields in economics, and collaboration: The ProbablyGood article says that development economics may be a good path for someone who is interested in economics, but wants to work in a more collaborative way. I don’t quite agree with this framing. Most academic economics research is collaborative, and increasingly so; it’s not “writing papers alone in offices their whole career.” But in development, you work with more people and at greater geographic distances. That was a main reason that, while I’ve contributed to a few development economics projects, becoming a PI was not for me. I found the prospect of supervising field employees in a far-away country really stressful.
Longtermism: I don’t think we know whether improving global health and development now will have a big effect on the long-term future. Development economists are the perfect people to answer that question! If someone receives a gift of $1000, what are the long-term effects of that? Does it help them escape a poverty trap, send their kids to a better school, and lead to more innovation and political stability? Does it increase or decrease fertility? Or does the effect disappear within a year? What about macroeconomic interventions and large-scale policy changes, like austerity or increasing funding to schools? There’s been work on all of these questions, but I love to see a lot more.
Thanks for this detailed feedback, I’m happy to hear you think the article would be useful to people in situations you’ve been in. All three of the points you raised seem reasonable—some touch on nuances that I already have down in my full notes but were dropped for brevity, while others are things we hadn’t heard yet from the people we interviewed (including those acknowledged in the article, and several others who preferred to remain anonymous). Based on consultation with others I’ll look into incorporating some of these nuances, though I apologize in advance that not all nuances will be incorporated.
This seems like really excellent feedback for them!
I have a query about your final point, where I think I agree with the PG framing. In general, I think when people talk about the long-term future they are including consideration of timescales much longer than the few decades most of the examples you mentioned, of the order of hundreds of years, or even longer. This is one reason reducing existential risk is so popular (because while affecting the shape of the future seems both extremely uncertain and fairly dependent on world view, making sure that there is a future at all seems good from many perspectives, though not all). Am I correct in my intepretation that you were talking about “long term” mostly in the <100 year sense?
What does PG stand for? I did intend this feedback to be very positive. :)
I am claiming that causing economic improvements today could affect the future in 200+ years. The economic history literature provides many examples of events a few hundred years ago that cause surprisingly long-term, large, and diffuse effects today. That includes effects on governance, culture, and other aspects of “institutions”; improving these could plausibly reduce existential risk. I see this historical research as a proof of concept that very long-term effects might be possible, and I would love to see more economic historians and development economists trying to figure out whether modern changes have such long-term effects, and how.
Here’s some reading suggestions; if you want to look into this yourself, good keywords are “economics” plus one of “persistence,” “institutions,” or “path dependence”. Full disclosure, I have not looked into this stuff since 2013.
Papers in the vein of “long-ago economic events had a big effect on the present”:
“The Colonial Origins of Economic Development”, Acemoglu, Johnson, and Robinson (2001), has been cited 14k . The authors argue that the way countries were colonized in the early 1800′s had a large effect on per capita income today, because the colonists set up varying political institutions, such as property rights rules, which were highly persistent and affected economic development. Their book Why Nations Fail draws on this paper and others to argue that good economic conditions and good “institutions” tend to reinforce each other, and so do bad ones. (By “institutions”, they mean “the rules of the game”, such as democracy or property rights.)
A blog post with a good discussion: “Last weekend I attended a conference at Brown University on ‘Deep-Rooted Factors in Economic Development’. [....] Nearly all of the papers gave evidence that economic shocks or initial differences in economic outcomes dissipate very, very slowly, if at all.” The same blog has the series The Skeptic’s Guide to Institutions, a readable overview of the institutions literature, although (in the author’s words) “unfair, deliberately.”
“The Long Term Effects of Africa’s Slave Trades”, Nunn 2008. He says “I find a robust negative relationship between the number of slaves exported from a country and current economic performance” and that relationship is causal. In a later paper, he explores trust as a mechanism, saying “most of the impact of the slave trade is through factors that are internal to the individual, such as cultural norms, beliefs, and values.”
“The Persistent Effects of Peru’s Mining Mita”, Dell (2010) shows that a forced labor system in Peru from 1573 to 1812 lowered present-day household consumption by 25% and increased childhood stunting by 6%. She also attributes the persistence to institutions.
It sounds promising for people working on economic development that past events can have huge effects on the long-term future, but there are some caveats...
Economic history projects do not typically have the randomized controlled trials, high-quality data, or huge data sets used in other branches of economics, making the “persistence” literature less credible. “Colonial Origins” has been controversial on empirical grounds
Even if these papers are right that really bad things in the past had persistent effects, that doesn’t imply that doing good things things today will have persistent effects. “Critical junctures” may be in the past, an idea that Acemoglu et. al. (2008) touch on.
We should not expect a lot of persistence if there is an an overall trend towards convergence, where poorer countries tend to grow faster.
At the country level, poverty just doesn’t seem to be very persistent. See “Do Poverty Traps Exist?”.
My personal view is that if we improve present-day global health and development, we probably won’t change the far future much, but there’s a decent chance we would. There is empirical proof-of-concept backing for “persistence” and theoretical justification in the form of models of multiple equilibria and self-reinforcing cycles. I’d love to see more development economists and economic historians studying the conditions needed for persistence.
Thanks so much, I’ll check these links out!
(I had abbreviated “Probably Good” to PG)